vans, warehouses, and the organized freight forwarding service. Artificial hindrances of traffic are the quarantine, blockade in times of war or suspension of relations between countries, contraband regulations, activities of pirates and land robbers, frontier regulations of countries, states, provinces, municipalities, tribes and similar impediments.

Traffic conditions affect international commerce inasmuch as they affect the carriage of persons, communications and goods. The carriage of persons is of importance in facilitating the meeting between buyer and seller; the carriage of news facilitates the communication between buyer and seller, leading to the negotiation and finally to the conclusion of business deals; and lastly the carriage of goods forms the fundamental basis of international commerce.

The extent to which traffic conditions facilitate the course of international commerce is of greater importance than in domestic commerce, because in international commerce the distances between the seller and the buyer are generally greater. The principal element in this connection is the cost of transportation. While it is not of equal importance for all classes of goods, nevertheless the item of transportation cost, together with the item of customs duties, affects the competitiveness of an article. It may make an article incapable of competition, although from the point of view of production cost and efficiency it be competitive, and on the other hand it may make an article capable of competition, although from the point of view of production cost and efficiency it was not competitive to start with.

The element of traffic conditions affects also the concentration of merchandise in certain points. Favorable traffic conditions are responsible for the origin and growth of trading centres. In the early history of commerce the development of commercial activity was bound to the route which the merchandise shipment took. Business could be carried on only from the spot where goods were located or expected. Nowadays commercial transactions are concluded by merchants located in trading centres where the goods bought or sold may never be seen. A commercial technique has been developed making this condition rather the rule for some classes of goods. While this condition appears as a sort of emancipation from traffic conditions, nevertheless it is the outgrowth of the development of transportation routes and media. Only the highly developed state of transport media for persons and communications permits the merchant to sell as a middleman merchandise which he neither accepts nor delivers in person, because he can issue instructions which he knows will be promptly and accurately carried out, and which he can control with very little loss of time.

However, business carried on in this way is never the principal source of the commercial activity of a trading center. Actual storing of merchandise in warehouses and actual shipment guides the bulk of international commerce activities to important maritime ports. For this reason the traffic radius of a trading center still coincides with its selling radius, although here and there are places which are more important as traffic centers than as trading centers, as for instance Rotterdam. In all of the important traffic centers the tendency is to seek the control of the commerce that goes through it, and the trading center from which the traffic in goods sold therefrom is alienated cannot fully retain control of the commerce in question (San Francisco and Seattle with relation to the Far East trade illustrate this point).

Transportation facilities, to afford the maximum of benefit to commerce, must meet the following requirements: a) security, b) speed, c) frequency and regularity of service, d) cheapness, e) simplicity of routine and f) suitability of individual transport media.

a) Security. Taking first the matter of the carriage of communications-which is an essential element in facilitating commercial transactions beween persons separated by any distance, we have an illustration of a safe and cheap facility (for certain distances) in the telephone: here we have security, as the communicating parties can be personally identified; speed-practically instantaneous; all the other requirements are also fully met.

Next to the telephone we have the postal service. This has been highly developed and being managed by governments, with international agreements covering the service between countries, it affords the security of official supervision and responsibility; it carries communications with as much speed as is humanly attainable in the forwarding of written messages; and the risk is only limited to acts of God and to the delays of censorship and of blockades in times of war.

Lastly we have the telegraph, the cable and the wireless service. Here the essential characteristic is speed. Commerce between distant points largely depends upon these services, though the element of insecurity is comparatively high, as messages are liable to mutilation in the course of transmission. But the necessity of securing practically instantaneous connections with distant points outweighs the element of insecurity, particularly as ingenious devices have been developed to counteract the risk of mutilations.

In the carriage of goods and of persons we find the element of security exemplified in the train service on well regulated railroads in progressive countries. In navigation the element of security is a little lower, and here we find gradations of security -inland navigation being considered safer than ocean navigation; in the case of the latter again the element of security is higher in steamers than in sailing vessels. Even among individual vessels the element of security varies with the age and the equipment of the vessels, as those provided with the wireless apparatus compared with vessels lacking it. Of all media of transportation the characteristic of the lowest degree of security is illustrated by a caravan passing through territories subject to attacks by uncivilized tribes.

The element of insecurity in means of transportation leads to transport insurance. The degree of the risk is determined by the degree of insecurity of the transportation and by the value of the goods. Therefore almost all goods shipped by sea as freight are insured, whereas in the case of articles transmitted through the post only those of exceptional value are registered or insured.

Security in transportation is one of the bases of modern international commerce. The improvement in the means of transportation with the view of increasing the degree of security afforded by them, the pacification and the civilization of undeveloped territories are the premises on which international commerce has expanded and made it possible to sell goods everywhere at low prices,

b) Speed. Speed in transportation is another important element in the development of international commerce. It is not only important in the matter of carrying persons and communications, but also in the carriage of goods. The speed of transport media has made it possible to conclude business on the basis of guaranteed time delivery. In the earlier days of international commerce goods were largely shipped to destination unsold, the endeavor being to dispose of them at the best possible prices. Nowadays it is possible to receive an inquiry for goods, to make an offer, to receive an order, to ship the goods and to receive the purchase price all within a reasonable space of time, and this is the modern method of international commerce. The risk and the speculation involved in the obsolete method hindered the expansion of international commerce. But even to-day the element of celerity is an important factor. Where goods cannot be delivered in time to be of use, business between two points cannot develop. We are on the threshold of a new era in transportation with the prospect of the development of commercial aerial transportation.

c) The next factor in importance is the frequency and the regularity of transportation service. The railroad service in most civilized countries furnishes the maximum of frequency and regularity in transportation, but even this service is apt to be inadequate and irregular in undeveloped territories. Balkan states, the Far East, certain Latin-American countries and colonial possessions of various powers are examples of this. Frequency and regularity in maritime transport are of tremendous importance for the development of commerce between the exporting and the importing countries. Occasional and irregular sailings cannot promote commerce between an exporting country and the customer overseas.

Regularity in transportation is an element which makes it possible for an exporter to make definite delivery promises. He must have the assurance that the goods which he has ready for shipment will be taken on board at a certain time and delivered at the destination within a period which he can calculate with some degree of accuracy. For this reason regular steamship lines offer greater security than occasional sailings of so-called tramp boats.

d) The cheapness of transportation is an element of obvious importance. The post office furnishes an illustration of extension of traffic due to cheapness. The parcels post in particular makes the transportation of small lots of goods so cheap as to stimulate business of this character enormously where it has been introduced. Cheapness of telegraph and cable messages with the additional economy of compressing messages into a small number of words through the use of codes is a factor in facilitating international commerce. The cheapness of transport on board of vessels, as compared with the dearer but speedier transportation by railways, is a factor greatly affecting competitiveness where waterways and railway routes serve the same points. Special inland freight rates for export traffic have been designed in many countries to add to the competitiveness of export merchandise.

e) Simplicity of routine. The reduction to the minimum of difficulties, labor and trouble in international trade relations has greatly furthered the expansion of international commerce. The introduction of uniform Bills of Lading, of through Bills of Lading which make it possible to convey goods over a series of connecting railways to the port of shipment, without the multiplication of handling en route are illustrations.

The complicated nature of railway freight rates, the arbitrary charges for maritime freights on the basis of either space or weight at the option of the carrier are illustrations to the contrary.

f) Suitability of the transport media. Finally we must consider as a factor furthering international commerce in the matter of transportation such developments in the equipment of transport media as refrigerating devices on railroads and ocean vessels, special cars and specially designed arrangements for dealing quickly and effectively with special classes of merchandise, tank boats for carrying oils, etc.

4. Governmental Influences Affecting the Exchange
of Goods between Countries.

It is the province of commercial politics to examine at length the governmental influences affecting the passing of mer